Carbonable is a web3-powered platform that aims to enable individuals to invest in nature-based solutions to climate change. The platform offers nature-backed financial assets and enables users to purchase Carbonable NFTs, which offer stakes in nature-based decarbonization projects that generate annual carbon credits. Users can then choose to sell these credits for a yield or use them to offset carbon emissions. Carbonable also provides a dashboard, launchpad, farming, and portfolio management tools.
Challenges: voluntary carbon market
Since the Industrial Revolution began around 1750, human activities have contributed substantially to climate change by adding carbon dioxide (CO₂) and other heat-trapping gasses to the atmosphere. Efforts to slow or stop climate change revolve around righting the carbon imbalance in the atmosphere.
The voluntary carbon market is a market where companies and individuals can buy carbon credits to offset their carbon emissions. The voluntary carbon market is different from the compliance carbon market, which is regulated by governments and requires companies to meet certain emissions reduction targets. The voluntary carbon market is not regulated and is driven by companies and individuals who want to take action on climate change.
Carbon credits are a way to invest in projects that reduce greenhouse gas emissions, such as renewable energy or reforestation projects, and receive a credit for the amount of carbon dioxide that is avoided or removed from the atmosphere. These credits can then be sold to companies or individuals who want to offset their own carbon emissions.
For example, when a decarbonization project is funded, investors receive “voluntary carbon credits”:
1 credit = 1 metric ton of avoided or removed greenhouses gasses
These credits can then be sold to big companies trying to achieve their “net-zero” pledge, generating financial income.
Demand for these credits has exploded in the last 3 years. The voluntary carbon market has grown rapidly in recent years, reaching $2 billion in 2021 and expected to reach between $10 billion and $40 billion by 2030. At this rate, by 2023 there will be no more carbon credits available on the market to satisfy the booming demand. By financing nature-based decarbonization projects, there is a huge opportunity to increase the supply of carbon credits.
The apparition of the voluntary carbon credit market is a fantastic opportunity to give tangibility and financial value to natural ecosystems, but it is very opaque, and the quality and ethics of carbon credits have been heavily questioned. This market lacks transparency, as sourcing traceability and project monitoring are not yet factors. In addition, the issuance of carbon credits is disconnected from the real world (forests can burn and carbon credits are still valid).
There is an opportunity to change the market by using blockchain and web3 to increase trust and transparency, resulting in more efficient and faster allocation of market resources.
Carbonable aims to overcome challenges in the voluntary carbon market by tokenizing nature-based decarbonization projects (NFT collections) to provide full transparency, make their fund more fluid, and enable participation by anyone.
For each selected nature-based decarbonization project, Carbonable pieces it into NFTs. One Carbonable NFT is equivalent to a piece of nature-based decarbonization project. The number of NFTs available depends on the project’s total carbon removal capability. Therefore, NFTs are regarded as “proof of participation” certifications for the holders, and crypto investors can buy them using stable coins.
Each NFT has its own metadata on the blockchain (exact location, project characteristics…). Carbonable uses cutting-edge monitoring methods, such as AI, satellite imagery and field data apps to ensure that rewilding is occurring as planned.
The use of blockchain technology by Carbonable ensures traceability and transparency in the carbon credit market, which is crucial for enhancing the integrity of carbon markets and preventing greenwashing.
Carbonable’s a simple, intuitive, and cost-effective carbon compensation management system generates a sustainable impact for local communities and biodiversity.
The chart below shows the operation of Carbonable carbon credit funding and management system.
- Step 1: Carbonable identifies the best nature-based decarbonization projects
Carbonable has access to premium nature-based decarbonization projects and can select the most promising ones in terms of carbon removal capacity and externalities due to its world-class international partners.
- Step 2: NFTs are created for each project and sold on Carbonable launchpad
Carbonable pieces each selected project into NFTs that can be considered as “proof of participation” certification for the holders, and stable coin can be used to buy them.
Carbonable’s launchpad will enable crypto investors to select their favorite projects based on project location, project type, local jobs created, and other factors. NFTs can be sold on the secondary market at any time, just like any other NFT. By staking their NFTs on Carbonable, holders will be able to receive financial yield in stable coins on a daily basis as well as CARBZ utility tokens throughout the duration of the project.
- Step 3: Once a project is financed, Carbonable receives inherent carbon credit
When all NFTs of a collection are sold on the launchpad, funds are transferred to the project developer and Carbonable begins receiving carbon credits six months later.
Each project constitutes a collection of NFTs available for sale during a set period of time. On the launchpad, anyone can see the amount already gathered and how much is still available. Carbonable helps project developers in obtaining ex-ante stage funding.
Carbonable will only provide the project developers with the required advance on a monthly basis in order to keep project holders accountable and limit risk exposure for investors. For example, if a project is terminated or mismanaged, Carbonable doesn’t have to continue funding it and can refund the remaining funds to NFT holders.
Carbonable receives carbon credits known as “offsets” that can be traded on the global voluntary market. Carbonable manages these carbon credits on the behalf of the NFTs’ holders in order to maximize their underlying yield.
- Step 4: Carbonable gets the best financial value out of these premium carbon credits
Carbonable manages and sells these carbon credits above market prices due to its internal expertise, high quality project sourcing, and cutting-edge monitoring practices.
For example, Carbonable finances a decarbonization project for $1M.
In the contract, the project holder commits to delivering 10,000 carbon credits annually for 30 years. Price for 1 carbon credit is fixed at 10$ for the duration of the contract, 30 years.
In year Y+1, Carbonable receives the initial 10,000 carbon credits for a total cost of 10 x $10,000 = $100,000. If the market price is $12, Carbonable can sell all of them and make a profit of $120,000 – $100,000= $20,000.
In year Y+30, Carbonable receives the remaining 10,000 carbon credits for a paid amount of $100,000.The market price is now $50 , so the profit is $8,000,000 – $100,000 = $7,900,000.
All of this value is created for NFT holders who are not necessarily experts in carbon credits, so that they can effortlessly enjoy a very comfortable financial yield.
- Step 5: By staking their NFTs, holders get ongoing financial yield in stable coins and CARBZ utility tokens
Investors receive two rewards for staking: a high and steady rising APR due to the reality-backed underlying assets (carbon credits) and Carbonable CARBZ utility tokens for governance and yield boosts.
- Step 6: Cutting-edge monitoring and traceability enable personalized impact reports
Carbonable NFTs are not just cards. These plots of nature are rewilded thanks to NFT holders, so the least Carbonable can do is show them in real-time the amazing regeneration.
According to BCG’s report on the voluntary carbon market, the voluntary carbon market was worth $2 billion in 2021, four times its value in 2020. In addition, by 2030, the market is expected to reach between $10 billion and $40 billion. According to Bain & Company’s bottom-up analysis of 2,000 leading global companies, the voluntary carbon market could generate demand for up to 2.6 gigatons (Gt) of carbon credits by 2030, which is about 13 times more than the market in 2021.
Carbonable offers a carbon credit funding and management platform that enables companies to invest in carbon capture on the blockchain and drive their climate contributions by using blockchain as the glue and incorporating other technologies such as satellite imagery and artificial intelligence.
The company’s platform allows individuals to invest in carbon removal projects through NFTs, and Carbonable charges a fee for these investments. Carbonable generates revenue through service fees, such as transaction fees for buying and selling carbon credits on its platform.
Carbonable’s use of blockchain technology ensures traceability and transparency in the carbon credit market, which is essential to increase the integrity of carbon markets and prevent greenwashing.
Carbonable is funded by 4 investors, including StarkWare Industries, Sylvain Theveniaud, La Poste Ventures, and Ethereal Ventures. StarkWare Industries and Sylvain Theveniaud are the most recent investors.